All the crypto biggies have witnessed a sharp fall in the market-cap in the last few days and meme coins are no exceptions, experiencing a severe meltdown.
With crypto majors like Bitcoin and Ethereum halving their value from the peak, meme tokens including Shiba Inu and Dogecoins have plunged more than 70 per cent from their peaks.
Cryptocurrency investors who have piled up meme coins are finding this year’s journey so far pretty painful as the crypto prices have become less breezy, said the market experts.
Anshu Agrawal, Co-Founder, Flint said, “Meme tokens were supposed to have certain designated use cases of their own, and have unfortunately been more associated with online jokes than other software products that are sector originals.
Their performance and fame depend on influencers’ social media support and hype, he added. The lack of euphoria adds to the negative sentiments amongst the investors.
These factors, plus the proposal of ban from the Central Bank of Russia and the hawkish commentary from the US Federal Reserve are several reasons that are hurting the sentiments for meme coin investors.
In addition to this, the United Kingdom, Spain, and Singapore regulators also tightened the rules on crypto-asset promotion. All these have added to the downward trend of not only meme coins, but for the whole crypto spectrum.
Praveen Kumar, founder and CEO for Belfrics Group said, “When mainstream cryptocurrencies are having a bad run, meme tokens will experience much worse downfall as these coins are traded purely on sentiments and speculations.”
Other crypto tokens including MonaCoin, Dogelon Mars, DogeBonk, ERC20, Doge Dash, SafeMoon Inu, Dogs Of Elon and Doggy have lost about up to per cent of their value from the peaks.
Commenting on the future of the these tokens, Edul Patel, CEO and Co-founder of Mudrex, said that other new altcoins and meme coins are also here to stay,” said
“The future of these coins broadly depends on the ability to foster a stronger community, relevance, purpose and offer some sort of value for its holders,” he added.
Market experts said that there is no guarantee if they are a good investment, despite the fact that they can increase their overall value during the bull market or trend events. Investment in them might be profitable, but they are highly volatile in nature.
If used in the right light, meme coins can actually be really valuable for faster transactions, or tipping use cases, said Sharma. “However, that doesn’t seem to be the major case as of today.”
According to Patel of Mudrex, meme coins are a good investment option if the community, associated influencers and uses are sound and strong. “The coin becomes a good bet for investors if it has value,” he added.
Market experts say that meme coins are more of speculative bets, but should not be treated as an investment. Crypto coins such as Dogecoin are inflationary coins with an unlimited supply.
“Even though they fundamentally hold a meaning, they are just cultural coins today, and people trade them because they like memes,” Sharma of Flint said.
A large number of investors are holding and trading these tokens. The interest will remain for quite some time, Kumar of Belfrics said. “Investing in meme coins is not a good choice for long term investors as they do not carry intrinsic values.”